HomeMy WebLinkAboutItem 12b - Increasing Settlement Authority of City ManagerClass Specification Revision & Amendment to Resolution No. 7321
February 2, 2021
Page 3 of 3
DATE: April 20, 2021
TO: Honorable Mayor and City Council
FROM: Dominic Lazzaretto, City Manager
Hue Quach, Administrative Services Director
By: Shama P. Curian, Human Resources Administrator
SUBJECT: ORDINANCE NO. 2376 AMENDING SECTION 1902 OF ARTICLE I,
CHAPTER 9, OF THE ARCADIA MUNICIPAL CODE INCREASING
SETTLEMENT AUTHORITY OF CITY MANAGER ($25,000)
Recommendation: Adopt
SUMMARY
At its regular meeting on April 6, 2021, the City Council voted to introduce Ordinance
No. 2376, amending Subsection 1902 in Article I, Chapter 9, of the Arcadia Municipal
Code, increasing the City Manager’s settlement authority limits to up to $25,000 for all
claims and lawsuits brought against the City. Attached is a copy of Ordinance No. 2376,
and the April 6, 2021, City Council staff report.
RECOMMENDATION
It is recommended that the City Council adopt Ordinance No. 2376 amending Section
1902 of Article 1, Chapter 9 of the Arcadia Municipal Code to increase the City
Manager’s settlement authority to $25,000.
Attachments: Ordinance No. 2376
April 6, 2021, City Council Staff Report
Ordinance 2376, City Manager Settlement Authority
April 6, 2021
Page 3 of 3
DATE: April 6, 2021
TO: Honorable Mayor and City Council
FROM: Dominic Lazzaretto, City Manager
Hue Quach, Administrative Services Director
By: Shama P. Curian, Human Resources Administrator
SUBJECT: ORDINANCE NO. 2376 AMENDING SECTION 1902 OF ARTICLE I OF
THE ARCADIA MUNICIPAL CODE INCREASING SETTLEMENT
AUTHORITY OF CITY MANAGER ($25,000)
Recommendation: Introduce
SUMMARY
It is recommended that the City Council introduce Ordinance No. 2376 amending
Section 1902 of Article I of the Arcadia Municipal Code to increase the City Manager’s
discretionary authority up to $25,000 for settlement of any claims and lawsuits against
the City.
BACKGROUND
Chapter 9 in Article I of the Arcadia Municipal Code sets forth procedures by which a
person may file a claim against the City to recover money or damages. Section 1902 of
this Chapter establishes authority limits to the City Manager for settlement of claims,
and delegates the ability for the City Council to compromise or settle claims above the
City Manager’s settlement authority.
DISCUSSION
Currently, the City Manager has authority to settle liability claims on behalf of the City in
an amount up to $10,000 pursuant to City of Arcadia’s Municipal Code Section 1902.
This authority was last increased in 1992. Between 1992 and 2021, the cumulative rate
of inflation increased by 87.5%, effectively reducing the City Manager’s purchasing
power to expeditiously settle liability claims. In addition, since 1992, court congestion,
attorney rates, and the ever-expanding complexity of litigation matters has increased
the value of liability claims dramatically.
Ordinance 2376, City Manager Settlement Authority
April 6, 2021
Page 2 of 3
Existing procedures require that all claims over the amount of $10,000 be presented to
the City Council for review and handling. Increasing the settlement authority to $25,000
allows for greater efficiency in claims processing and streamlines internal processes. In
the event that a rejected claims is litigated, the matter would continue to be brought to
the City Council for review and consideration. Additionally, the City Council will continue
to receive quarterly reports detailing claims made against the City, including specifying
those with settlements or rejections in the preceding months.
A review of surrounding cities illustrates that most cities have set the City Manager’s
settlement authority at or around $25,000.
ENVIRONMENTAL ANALYSIS
The proposed action does not constitute a project under the California Environmental
Quality Act (“CEQA”), and under Section 15051 (b)(3) of the CEQA Guidelines, as it can
be seen with certainty that it will have no impact on the environment. Thus, this matter is
exempt under CEQA.
FISCAL IMPACT
Minor savings are likely to occur as a result of amending this Ordinance in that some
claims that would otherwise need to be presented to, reviewed, and approved by the
City Council could be settled by the City Manager. When this occurs, some City
Attorney costs are avoided. In addition, when claims are settled more quickly,
reimbursements to opposing counsel can sometimes be lessened as well.
City Manager Settlement Authority
City Amount
Arcadia $ 10,000.00
Azusa $ 25,000.00
Burbank $ 20,000.00
Chino $ 25,000.00
Covina $ 25,000.00
Glendora $ 25,000.00
Monrovia $ 25,000.00
Pasadena $ 25,000.00
West Covina $ 30,000.00
Whittier $ 10,000.00
Ordinance 2376, City Manager Settlement Authority
April 6, 2021
Page 3 of 3
RECOMMENDATION
It is recommended that the City Council determine that this is not a project under the
California Environmental Quality Act (“CEQA”); and introduce Ordinance No. 2376
amending Section 1902 of Chapter 9 of Article I of the Arcadia Municipal Code to
increase the City Manager’s settlement authority to $25,000.
Attachment: Ordinance No. 2376